Obviously Merrill forgot to speak with the all-knowing Larry Kudlow of CNBC who sees bright skies and happy days for all. Third term, anyone?
"I still maintain the business cycle is bigger than the government," Merrill's North American economist David Rosenberg said at a client conference in Singapore.
He said the world's largest economy was already in recession as consumer spending and confidence had fallen and jobs losses were rising, with the number of hours worked having fallen sharply.
Describing housing as "the quintessential leading indicator," Rosenberg, a long-time bear on the U.S. economy, said he expected home prices to fall another 15-20 percent before stabilizing.
He also predicted inflation in the United States would slow as consumer spending weakens, and that the Federal Reserve would be forced to cut rates further to deal with the recession.
Of course it is. The only people who think otherwise are the Republicans who created this problem and Wall Street who are immune to the recession thanks to massive welfare checks from taxpayers.
The "Misery Index" was often cited during periods of high unemployment and inflation, such as the mid 1970s and late 1970s to early 1980s.
And some fear the economy may be approaching those levels again.
The official numbers produce a current Misery Index of only 8.9 -- inflation of 3.9% plus unemployment of 5%. That's not far from the Misery Index's low of 6.1 seen in 1998.
But using the estimates on CPI and unemployment from economists skeptical of the government numbers, the Misery Index is actually in the teens. Some worry it could even approach the post-World War II record of 20.6 in 1980.
"We're looking at government numbers that are really out of whack," said Kevin Phillips, author of the book "Bad Money."
Anyone who honestly believes big business will give any authority to regular shareholders on pay or for that matter, pay executives on results like everyone else, is simply kidding themselves. Not going to happen on its own. Ever. The only way this will change is complete collapse of the economic system (which is also unlikely) or Congress steps in and changes things. As it stands today, business receives too much encouragement to play games like this. It's all there in the existing tax code which even goes as far as allowing business to pay the taxes of these overpaid executives.
Fair is fair and what we have today is unfair. Let's see how well America's corporate leadership does when they have to live by the rules for everyone else. Considering how poorly they are doing today, why should they receive all of the gifts without any of the risk? We used to be a country that sought a level playing field and it's high time we get back to that traditional value. Obviously there are benefits for the select few but for the greater good of both the businesses and America, the benefits are hard to find.
What idiot or group of idiots decided to give away taxpayer money without any strings? Who does business this way? I get the whole "banks need liquidity to move the economy" thing but c'mon, banks are taking that free money and sitting on it or investing it elsewhere. Obviously the banks were giving loans away too easily before but to suddenly cut off everything is just as bad. If banks don't want to loan, fine, but don't ask everyone else to fund their mistakes as Wall Street continues to live the life of Riley and using Uncle Sam's cash at below inflation rates. If the tables were turned, you know the banks would be asking for the world so why not treat them the same way?
What makes it worse is that none of the candidates are saying much about this bailout. Are they really in agreement with this policy of supporting the lifestyle decisions of Wall Street? Sure we are seeing tens of thousands of Wall Street bankers being fired but we have yet to see any real changes on Wall Street. Just like last year - despite record lows - we're going to read about bonuses that are more than most people make in a lifetime or tens of lifetimes and guess who is funding it all? Lots of people would love the Wall Street lifestyle, but I don't see Wall Street lining up to fund it without strings.
And the benefit to consumers? About $28. We can't afford more Republican economics like this. This article is only for the state of Washington so imagine this across the US.
Sen. Patty Murray, D-Wash., is chairwoman of the Senate Transportation Appropriations subcommittee and has endorsed Clinton. She doesn't support a federal gas tax suspension.
"She has a firsthand look at what's going on with our transportation systems, our roads and our bridges, and from her perspective, this is bad idea," said her spokeswoman, Alex Glass.
There's no guarantee that the plan would result in lower gas prices, but it would deteriorate highway funding, Glass said.
"The gas tax funds the Highway Trust Fund, and there are a number of critical infrastructure needs -- roads and bridges across the country -- that need to be maintained and repaired," she said. "We just can't afford to have crumbling infrastructure."
"High rates of delinquency and foreclosure can have substantial spillover effects on the housing market, the financial markets, and the broader economy," Bernanke said in remarks prepared for delivery to the Columbia University School of Business in New York.
Naturally none of this prevents him from a strict whatever-Wall-Street-wants policy of cushy bailouts and rate cuts. What next? Is Bernanke going to boldly state that interest rate cuts to banks don't transfer to individuals or that when the dollar goes down, gas prices go up with each rate cut?
Where the heck were Bernanke and Greenspan, the Fed, and the Republicans when this fragile system was being built up? They're all supposed to be so smart, so how did they honestly think that real estate would always increase? Have they never studied bubble economies before? How did we get stuck with such an incompetent bunch?
Yea, but what does the world's richest person and most successful investor know about the economy? He supports Democrats so obviously he's a communist and is against our glorious leader. Clearly we need more tax cuts and less regulation as McCain says.
Last Wednesday, the Commerce Department said the economy grew at a 0.6 percent annual rate in the first quarter. But Buffett said the nation's population also grew, making the real growth rate lower. He also said that, even if the data do not show the economy retracting, people feel as though it is.
"The U.S. is in recession as I define it," Buffett said. "I would define that as a situation where people are doing less well than they were three months, six months or eight months earlier and most businesses find themselves in that position too.
"If were are in a non-recession, I don't think people want to see it going in the same direction as it is and saying it's wonderful."
Who knows how long the trend will continue but for now, the euro is king on the street.
The US dollar bill’s standing as the world’s favourite form of cash is being usurped by the five-year-old euro.
The value of euro notes in circulation is this month likely to exceed the value of circulating dollar notes, according to calculations by the Financial Times. Converted at Wednesday’s exchange rates, the euro took the lead in October.
Obviously they aren't reading Larry Kudlow and the CNBC cheerleaders. Of course, Kudlow only hobnobs with the same spongers who just received hundreds of billions in bailout money, so they don't see the economic difficulties in quite the same way as the rest. Must be nice.
Seven in 10 people questioned in a CNN/Opinion Research Corporation survey released Friday say things are going badly, with only 30 percent saying things are going well.
"It's been 16 years since the public gave the country's condition such a bad rating: January 1992, to be precise, in the last year in office of the last president named Bush," CNN pollster Keating Holland said.
"Seventy percent is a lot worse than two years ago, when 48 percent thought times were bad and the Republicans lost control of Congress," CNN Senior Political Analyst Bill Schneider added.
Wow, that's a brutal figure. Plenty of people are saying that we have hit the bottom and as great as that would be, I don't see it.
457,000. That’s the number of construction jobs that have been lost since the sector peaked in September of 2006.
What’s interesting to me about this number is that at the beginning of the downturn in housing we didn’t see a huge drop in construction jobs, primarily because workers moved from residential into commercial.
Now that commercial is slowing as well, construction workers are falling out of jobs like flies. And they’re not the only ones. Big surprise furniture manufacturing jobs are falling as well.
Their big mistake was not being worth billions and having connections to the highest levels of Congress and the Administration. If they did, they too would receive billions upon billions and nobody would ask questions and everyone could live today as they did yesterday. Polite company doesn't ask uncomfortable questions about money. Especially when it's not even theirs to shovel out. What do the Democrats have to say for themselves now? They all too easily allowed the banks to get their bankruptcy law and then bailed out the damned banks without question.
Bankruptcy filings by U.S. consumers jumped 47.7 percent in April from one year ago as families cope with fallout from the subprime mortgage crisis, the American Bankruptcy Institute said.
The 92,291 bankruptcy filings in April also marked an increase of 7 percent from March, the non-partisan institute said.
It is definitely good news that the US only lost 20,000 jobs last month. It's not quite celebration material but in this market, Wall Street will take anything. If only they reacted so positively when Americans had real extra cash in their pockets from jobs and not temporary (gimmick) incentives but then again, when is the last time we saw such growth in the middle class?
These are amazing numbers and considering McCain's economic program is a third Bush term, Democrats need to finish up the primary and start focusing on November. McCain is going to wish he had a problem like Rev. Wright once the Democrats pounce on these numbers because McCain is joined at the hip with the Bush policies that Americans detest. It's all there from tax cuts for the wealthy, less regulation so we can have new problems, an insurance company free-for-all with health care (Bush's policy as well) and that's only the domestic policy. McCain is already struggling to get traction with his own party and this is hardly going to win over independents as the economy continues to sputter.
Fully 73 percent of Americans now disapprove of President Bush's handling of the economy, as his overall approval fell to 27 percent from 32 percent in March.
That represents a burden to Republican candidate John McCain. With poll respondents rating jobs as the top issue, some 61 percent of Americans say they have "major" or "moderate" concerns that McCain will be too closely aligned with Bush's agenda. That exceeds the half of Americans who express concerns over whether Barack Obama is out of touch with small-town values. A comparable 62 percent of Americans say they have concerns about figuring out where Hillary Clinton stands on the issues.
One could definitely argue that Americans collect much too much compared to people in other wealthy countries but still, this is yet another troubling sign. Again, when are the damned Democrats going to join forces with the overwhelming majority of Americans and kick Wall Street's ass for the bailout? It may have been something exceptional but any time you change the terms, well, you change the damned terms. Wall Street received their bailout, so let's tell Wall Street how their financial free-for-all is going to change. You are Congress so start acting like it.
"This is not about downsizing. It's about needing gas money," said Nancy Baughman, founder of eBizAuctions, an online auction service she runs out of her garage in Raleigh, N.C. One former affluent customer is now unemployed and had to unload Hermes leather jackets and Versace jeans and silk shirts.
At Craigslist, which has become a kind of online flea market for the world, the number of for-sale listings has soared 70 percent since last July. In March, the number of listings more than doubled to almost 15 million from the year-ago period.
Craigslist CEO Jeff Buckmaster acknowledged the increasing popularity of selling all sort of items on the Web, but said the rate of growth is "moving above the usual trend line." He said he was amazed at the desperate tone in some ads.
The advocates of a "gas tax holiday" are exaggerating the benefits to consumers from their proposal. If the Illinois experience is a guide, there is likely to be some reduction in the price of gas, but it would fall well short of the size of the tax reduction. In order to pay for the tax cut, the government would have to cut back on highway construction and maintenance or find some other way of plugging the shortfall in revenues to the Highway Trust Fund.
For everyone who boldly stated that the weak dollar would never have an negative impact at home ought to be eating their words about now. Sure a weak dollar can mean better exports for the US but for just about everything else, costs are going up. Republican policies including the war, the deficit, the tax cuts and a pro-business (at the expense of consumers) policy have all added up to create a headache for Americans both rich and poor. Add to this list the increasing problems due to the biofuel craze and you have a serious problem that will not be corrected by a simple action or two as both McCain and Hillary are suggesting.
Obama may not be saying the popular thing when he argues against a temporary tax cut on gas but it's the right thing. McCain and Hillary, who both supported the Iraq war, haven't explained where the money will come from for such a big tax cut nor have they or anyone else explained the financial consequences of the Wall Street bailout. (The bailout continues to be the 800 pound gorilla in the room that remains untouched by Democrats and Republicans alike.) Someone needs to start acting like a grownup instead of telling voters how easy answers are going to magically cure years of bad policy.
Many have been predicting the worst recession in decades and now Warren Buffet, the world's richest person, is moving to this camp.
"This is not a field of specialty for me, but my general feeling is that the recession will be longer and deeper than most people think," Buffett said. "This will not be short and shallow.
"I think consumers are feeling gas and food prices," he added, "and not feeling they've got a lot of money for other things."
No, not the Wall Street collapse and bailout or the skyrocketing price of oil since the Iraq invasion. Not talking about the increasing inflation that is crushing normal Americans. Nope, not talking about the sub-prime bubble bursting nor the failures of post-Katrina reconstruction. And no, this isn't about the budget surplus disappearing into a massive deficit either. Oh and no, this isn't about the corporate welfare called "no price negotiations with Big Pharma despite preaching about the free market" with the Medicare money. This is just another example of failed oversight in the black hole of spending called Iraq.
Millions of dollars of lucrative Iraq reconstruction contracts were never finished because of excessive delays, poor performance or other factors, including failed projects that are being falsely described by the U.S. government as complete, federal investigators say.
The audit released Sunday by Stuart Bowen Jr., the special inspector general for Iraq reconstruction, provides the latest snapshot of an uneven reconstruction effort that has cost U.S. taxpayers more than $100 billion. It also comes as several lawmakers have said they want the Iraqis to pick up more of the cost of reconstruction.
It's not very comforting that $200 per barrel is even being discussed but unfortunately, the OPEC president isn't the only person kicking this idea around.
He added: "The prices are high due to the fact of the recession in the United States and the economic crisis which has touched several countries, a situation which has an effect on the devaluation of the dollar, and therefore each time the dollar falls one percent, the price of the barrel rises by $4, and of course vice versa," he was quoted as saying in brief remarks to journalists on Sunday.
He added that: "If this (the dollar) strengthens by 10 percent, it is probable that (oil) prices will fall by 40 percent."
If the U.S. economic situation improved from now to the end of the year "that would help the market to stabilize."
Each day I wonder how things could possibly get worse, but they do. The complete mismanagement by Bush and the GOP is all catching up with the US. Why would anyone think that a third Bush term (with McCain) would be a good idea?
"More consumers reported that their personal financial situation had worsened than any time since 1982 due to high fuel and food prices as well as shrinking income gains and widespread reports of declines in home values," The Reuters/University of Michigan Surveys of Consumers said in a statement.
The report showed its reading on one-year inflation expectations climbed to 4.8 percent -- the highest since a similar reading in October 1990 -- from 4.3 percent in March.
